Lamont at turns parsimonious and progressive
If Republican state lawmakers can find some solace in their underdog position — they again face large Democratic majorities in the House and Senate — it is that Gov. Ned Lamont behaves like a moderate Republican on fiscal policy.
With the state flush with budget surpluses, Lamont, fresh from being sworn in for a second term after a solid re-election victory, announced in his State of the State Address that it is “time to enact a meaningful middle-class tax cut.”
And he is not alone among Democrats in emphasizing tax reductions.
Sen. Cathy Osten, D-Sprague, who co-chairs the powerful Appropriations Committee, has said she wants the state to expand its income tax exemption for retirement earnings. Under existing caps, the tax exemption is available to retirees with incomes less than $75,000 and couples with less than $100,000.
There is also support on the Democratic side for expanding and making permanent a state child tax credit.
The Republican caucus, which — no surprise — also wants tax cuts, must be pleased that the debate may well be about what taxes to cut and by how much, rather than about spending all that surplus.
In his post-inaugural address, the governor gave due credit to the bipartisan budgetary reforms passed in 2017 — establishing spending, volatility, and revenue caps — with providing the state with a healthy surplus and allowing it to start playing catch-up on the state’s grossly underfunded pension system. It is not time to abandon the fiscal guardrails that made it possible, Lamont said.
Connecticut has a $3.3 billion budget reserve, equal to 15% of the general fund, the maximum allowed by a law. A $2.8 billion surplus is projected for this fiscal year, which ends June 30.
His liberal critics see a disconnect between Lamont’s support for progressive social policies and his reluctance to spend more freely to address inequities in education and opportunity.
To mix 19th century literary references, Lamont is Dr. Progressive and Mr. Scrooge.
The progressive Lamont backed paid family leave, raising the state minimum wage, and is strongly in favor of gun control. In response of the Black Lives Matter movement, Lamont supported and signed into law reforms aimed at reducing discrimination by police in how laws are enforced, and that hold officers more accountable for misconduct.
The fiscally moderate Lamont resisted calls from the progressive wing during his first term to raise tax rates on the state’s wealthiest. He argued such a tax hike would be counterproductive by driving some multi-millionaires and billionaires, and the considerable taxes they pay, to other states.
As for stingy, The Connecticut Mirror documented how the Lamont administration worked behind the scenes to delay, and potentially scuttle, the “Baby Bonds” program that progressives had applauded as groundbreaking when it passed in 2021. It would place $3,200 in a trust for babies born into the state’s HUSKY insurance program for the needy. Expected to grow to $11,000 or more by the time they are adults, the money could be used for tuition, to buy a home or start a business, and on other steps to help class mobility. While he signed it into law, the plans for borrowing the funds concerned the governor, as did the unanswered questions and the potential bureaucracy. Who would administer it and with what safeguards? How would outreach be maintained over such a long period? What about parental consent and involvement?
With the programs biggest advocate, Treasurer Shawn Wooden, having not sought re-election, the future of the program is in doubt — and Lamont’s tightwad reputation enhanced.
Exactly what Lamont has in mind fiscally going forward will not be known until next month, when he releases his two-year spending plan.
Expect progressives in the Democratic caucus, backed by labor and social advocacy groups, to pressure Lamont to do more to address the extreme wealth inequality in Connecticut by directing more money to human services, education, health care, and housing.
But if he pushes back against big increases in such spending — in the words of his State of the State Address, prioritizing “fiscal stability” as “the foundation to inclusive growth” — Lamont could well turn to an unlikely coalition of moderate Democrats and Republicans to support him. The same sort of coalition that passed the budgetary reforms about which he has grown so fond.
Paul Choiniere is the former editorial page editor of The Day, now retired. He can be reached at email@example.com.